Court skeptical of limits on businesses, unions

Washington  The Supreme Court signaled Wednesday it may let businesses and unions spend freely to help their favored candidates in time for next year’s elections. Such a step could roll back a century of attempts to restrain the power of corporate treasuries in American politics.

The justices cut short their summer recess for a lively special argument that indicated the court’s conservative skeptics of campaign finance laws have the upper hand over its liberals, including new Justice Sonia Sotomayor.

Justice Anthony Kennedy, often the high court’s swing vote, but a firm opponent of many campaign restrictions, at one point told the government’s lawyer, “Corporations have lots of knowledge about environment, transportation issues, and you are silencing them during the election.”

Sotomayor jumped into the fray at her first argument — with questions that strongly hinted she would keep campaign spending limits in place. “Wouldn’t we be doing some more harm than good by a broad ruling?” she asked.

The court heard arguments for the second time in a case that began as a dispute over whether a conservative group’s 90-minute movie that harshly criticized Hillary Rodham Clinton’s presidential campaign should be regulated as a campaign ad. The court’s request for a new argument on broader questions turned the case into a test of whether two earlier high court decisions should be reversed.

One is a 19-year-old ruling that buttresses federal and 24 state laws that bar corporations, and in some cases unions, from dipping into their general funds to call directly for the election or defeat of a candidate. Regulation of such independent expenditures is distinct from other limits on contributions to candidates themselves and political parties, which are unaffected by the case.

The case also does not affect political action committees, which mushroomed after post-Watergate laws set the first limits on contributions by individuals to candidates. Corporations, unions and others may create PACs to directly contribute to candidates, but they must not be funded by corporate or union treasuries.

The justices also are weighing whether to jettison part of their 2003 decision upholding the McCain-Feingold law and its limits on when businesses and labor may pay for ads that mention candidates but don’t tell people how to vote.